2002 switch revenue down, shipments up

The LAN switch market is shrinking, but demand for products is higher than ever.

Falling prices are the cause for this paradox in the Ethernet switch market. A recent report from In-Stat/MDR shows that revenues from 2002 sales of Ethernet switches dipped from $US14.9 billion in 2001 to $US12.4 billion in 2002. However, port shipments jumped 12 per cent over the same time, going from 137 million ports shipped in 2001 to 154 million in 2002.

Layer 3 switches are one of the hottest product types. The report says Layer 3 was the fastest growing segment of the LAN switch marketing, jumping 13.8 per cent in port shipments.

Overall prices for LAN ports went from $US109 per port in 2001 to $US86 in 2002. Meanwhile, the average Gigabit Ethernet port dropped from $US802 to $US584 over that time. Despite falling prices, however, Gigabit made up only 5 per cent of Ethernet switch port shipments last year.

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